#UAE GDP expected back at pre-COVID levels by 2023 | ZAWYA MENA Edition

UAE GDP expected back at pre-COVID levels by 2023 | ZAWYA MENA Edition

The UAE’s real gross domestic product is expected to recover to 2019 levels by 2023 as a sharp drop in tourism and real estate activities — two key mainstays of the non-oil sector — will drag down the economy in 2020, according to economists and analysts.

The $414 billion UAE economy, dominated by Abu Dhabi (59 per cent of 2019 GDP) and Dubai (28 per cent), has been projected to contract 6.6 per cent in 2020 followed by a slight rebound of 1.3 per cent in 2021 by the International Monetary Fund.

The Washington-based Institute of International Finance, meanwhile, expects the UAE to experience a contraction of 5.7 per cent in 2020, followed by a modest recovery of 3.1 per cent in 2021.

S&P Global Ratings said in a recent report that Abu Dhabi can expect a gradual economic recovery from 2021, but with real GDP only to recover to close to 2019 levels by 2023.

“Hydrocarbon sector production will be boosted from 2022 as Opec+ oil production limits are lifted and new gas production comes on stream. Non-oil sector recovery will be driven by public investment in manufacturing particularly petrochemicals, logistics, and construction,” Trevor Cullinan, director at S&P Sovereign Ratings, wrote.